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Senate Panel Hears Testimony About Botched IRS Raid

Democrats complain GOP would rather talk about the tax agency's problems than act

IRS graphic

WASHINGTON (AllPolitics, April 29) -- A Senate committee looking at the tactics of the Internal Revenue Service heard Wednesday about a heavy-handed, botched raid on a Virginia restaurant, as lawmakers continued to shine a spotlight on the troubled tax collection agency.

But Democrats questioned the need for more hearings when legislation to bolster taxpayers' rights and improve legislative oversight of the agency is already waiting a vote on the Senate floor.

"When are you fellows going to quit talking about it and start doing something about it?" Sen. John Breaux (D-La.) asked Republicans.


Senate Finance Committee Chairman William V. Roth Jr. (R-Del.), however, said the committee's work is having "a very positive influence on the administration's commitment to addressing problems within the agency." Roth cited the Clinton Administration's appointment Tuesday of former CIA Director William Webster to investigate the IRS' criminal investigations division.

In the day's testimony, Roth's committee heard from John Colaprete, the co-owner of the Jewish Mother restaurant in Norfolk and Virginia Beach, Va., whose business was turned upside down in 1994 by agents with dogs and weapons. Customers were ordered to leave in the middle of their meals and employees were lined up and searched for drugs.


The IRS also carted off a truckload of property, including cash registers, computers and financial records. But five months later the case was dropped; the IRS found no evidence of wrong-doing. The raid, it turned out, was based partly on statements of a bookkeeper who the restaurant had fired for embezzlement.

"Unfortunately, rather than make restitution, [the bookkeeper] sought shelter with the IRS and told them a fantastic tale of money laundering, gun running and drug dealing by my partner and me," Colaprete testified.

Colaprete and his business partners are suing the IRS and state law enforcement agents for $20 million, alleging violation of civil rights.

The Jewish Mother case was one of several the Senate panel heard as part of four days of testimony from taxpayers and agents. Senators also listened to oilman W.A. Moncrief Jr. of Fort Worth, Texas, whose business was raided in September 1994.

"My employees heard the agents shout, 'IRS! this business is under criminal investigation! Remove your hands from the keyboard and back away from the computers. And remember, we are armed!' " Moncrief said.

Moncrief said he had committed no crime, but paid what he called a $23 million "settlement" to the IRS. Senators did not press him for further details.

Rossotti pledges cooperation


After the day's testimony, IRS Commissioner Charles Rossotti declined to comment on the specific allegations of IRS misconduct, but said he is committed to reviewing the criminal investigation division's practices and solving any problems he finds.

"I really think the important point is that we're accepting the fact that there is need to review this along with the rest of the IRS and determine if there are systematic problems and, if so, how we're going to fix them," Rossotti told reporters.

Rossotti said he could not comment on the testimony because of ongoing litigation, but would support Webster's investigation. Webster will review individual cases to determine if the IRS should change its tactics.

"It is essential that the IRS conduct itself properly in all dealings with taxpayers, including criminal investigations," Rossotti said. He said Americans deserve "an agency that treats taxpayers properly, respects their rights, while also collecting the taxes that are due."

In Other News

Wednesday, April 29, 1998

Sources: Judge Decides Lewinsky Doesn't Have Immunity
Grand Jury Hears Hillary Clinton's Videotaped Testimony
Assault Weapons In Transit Could Enter U.S.
Clinton Administration Dismisses Gingrich Claim Of Campaign Finance Coverup
Paula Jones Files Her Notice Of Appeal
Bob Dole To Receive DOD Highest Civilian Award
Senate Panel Hears Testimony About Botched IRS Raid
Clinton Raises Million For Democratic Senate Bids
Starr In Little Rock For Final Push Before Grand Jury

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